Finance
Arkhouse has financing in place for a Macy's take-private, managing partner Kahane says
Arkhouse has the financing in place to take Macy’s private at a bid of $5.8 billion, managing partner Gavriel Kahane told CNBC Thursday, but the activist investor has run into roadblocks without the department store retailer’s cooperation on due diligence.
“At this stage, based on public information, there isn’t a bank in the world that would give you committed financing, and that’s just par for the course,” Kahane said on CNBC’s “Money Movers.” He added that management’s response in the coming days and weeks would determine how Arkhouse moved forward.
Arkhouse has previously said it would take “all necessary steps” to acquire Macy’s, including going directly to shareholders.
Kahane’s Arkhouse and Brigade Capital submitted an unsolicited bid to Macy’s management in December to take the company private at $21 a share, a premium of more than 32%. Investment bank Jefferies has provided a highly confident letter, Arkhouse has previously said, meaning the bank believes the two firms will be able to raise the capital necessary to close the deal.
Arkhouse also said it could raise its bid above the original $21-per-share offer, but only if the Macy’s management was willing to sign a mutual non-disclosure agreement and permit diligence to begin.
Macy’s board rejected that offer on Sunday, saying in part that it believes it is “highly unlikely” Arkhouse and Brigade’s proposed financing “could be successfully executed.” It also refused to enter into a non-disclosure agreement or permit diligence to move forward, with CEO and chair Jeff Gennette saying in a letter to Arkhouse and Brigade that “such an exercise would unnecessarily distract our management team.”
Finance
Medina’s finance committee looks to reallocate income tax dollars
MEDINA, Ohio — In an effort to ensure the city has funds available for capital improvements, the city’s finance committee has agreed to amend the allocation of income tax dollars.
“After spending time talking about sidewalk improvements, I think it makes sense that we need to have money in our account for capital improvements,” Council President John Coyne said.
Coyne said that the city’s current income tax collection is around $21 million and 40 percent of that collection, or roughly $8.4 million goes to the police department. Coyne recommended changing the allocation to the police department to 38 percent and reallocating an additional 1 percent to the general fund and the other 1 percent to general purpose capital expenses.
“The police department would still get an ample amount for their budget, and they do have ample saved up in carry forward funds,” he said.
Coyne said he wants to make sure all departments are properly funded but added that with income tax revenue increasing over the years, he thinks it makes sense to put some money aside for capital improvement projects.
“We need to take a look at this every year and make sure we plan correctly going forward so we don’t reach financial issues in the future,” he said.
Mayor Jim Shields said he has talked to Police Chief Ed Kinney, and he said they understand the reasoning behind the reallocation.
“We used to have a list of all the capital improvement projects we wanted to focus on and there are other things in the city I want to start getting in front of you,” Shields told council.
Coyne said he thought it makes sense to spend the next couple of months to schedule committee of the whole meetings so council can discuss potential capital improvement projects that are needed in the city.
Finance
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